What is the compound interest formula?

A = P(1 + r/n)^(nt), where A is final amount, P is principal, r is annual interest rate (as a decimal), n is compounding frequency per year, and t is time in years. For monthly compounding, n = 12.

How does compounding frequency affect returns?

More frequent compounding (e.g. monthly vs yearly) gives a slightly higher final amount because interest is added more often and then earns more interest. For most savings and investments, monthly or yearly compounding is common.

Where is compound interest used?

Compound interest applies to savings accounts, fixed deposits, bonds, mutual funds, and many other investments. It also applies to loans: interest is often compounded monthly, which is why the EMI formula uses a monthly rate.

What is the difference between compound and simple interest?

Simple interest is calculated only on the principal. Compound interest is calculated on principal plus previously earned interest. Over time, compound interest grows your money (or your debt) much faster than simple interest.

Compound Interest Calculator

Free compound interest calculator. Get instant results — no signup, no account. Plan and compare with confidence.

Use the Compound Interest Calculator below.

Calculate compound interest on your investment or savings. Enter principal, rate, and time to see how your money grows with compounding.

How to use Compound Interest Calculator

Enter principal
Input the initial investment or loan amount.
Enter rate and period
Enter annual interest rate and time in years.
Choose compounding
Select compounding frequency (monthly, yearly, etc.).
View results
See final amount and total interest earned.

Features

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Works on all devices — desktop, tablet, and mobile.
Your data stays private — we do not store your inputs.

Why use this calculator

Plan your finances with accurate estimates.
Compare scenarios in seconds.
Make informed decisions before you borrow or invest.

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Frequently asked questions

Complete guide to Compound Interest Calculator

What is compound interest?

Compound interest is interest calculated on both the initial principal and on interest already earned. So your money grows faster than with simple interest, where interest is only on the principal. Compounding frequency (e.g. monthly or yearly) affects the final amount: more frequent compounding gives a slightly higher result.

Compound interest formula

For example, with annual compounding, n = 1. With monthly compounding, n = 12. This calculator uses monthly compounding by default. The same formula applies to savings accounts, fixed deposits, and many investments.

A = P × (1 + r/n)^(n×t)

A = final amount, P = principal, r = annual interest rate (decimal), n = compounding frequency per year, t = time in years.

Why compounding matters for savings and investments

Longer time horizons allow compounding to have a bigger impact.
Higher (but realistic) rates accelerate growth.
Reinvesting interest or dividends keeps compounding working for you.
Starting early gives more years of compounding.

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Disclaimer

Our financial calculators are for informational and educational purposes only. Results are estimates based on the inputs you provide and standard formulas. They are not financial, tax, or legal advice. We do not store or share the numbers you enter.